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Unicorns overwhelmingly originate in big cities

In the world of startups, a unicorn is used to refer to a company with a market cap greater than $1 billion. A decacorn, the latest benchmark, is what it sounds like in that it’s a company with a market cap greater than $10 billion.

While unicorn status is just one measure, valuations are an important yardstick for cities and countries. How many big new companies are you creating? That is a critical question because, presumably, these big new companies are going to create a bunch of new jobs and generate a lot of new wealth for people.

This recent blog post by Elad Gil is a great summary of what’s happening in the world from this perspective. The raw data is also available if you’d like to dig deeper.

Here are the number of new unicorns since October 2020 by city:

Silicon Valley, not surprisingly, continues to dominate, followed by New York.

Here is a breakdown for the United States as a whole:

Miami and Austin have been in the news a lot over the past year and their startup scenes may very well be on the rise relative to other US cities. But it’s interesting to see other smaller cities on this list, like Salt Lake City, who are, at least right now, holding their own.

I found this last set of two charts particularly interesting:

They are showing unicorn count (first) and unicorn market cap (second) as a percentage of their respective countries. For example, Silicon Valley is sitting at about 47% and 51%, respectively. So about half of all unicorns in the US have originated from this geography.

But for most other cities on this list, the percentage is much higher and, in many cases, it is 100%. (Silicon Valley is perhaps relatively low because the US has lots of other big and important cities.) For me, this shows the continued dominance of cities. If you’re building the next great unicorn or decacorn, the data tells us that you’re probably doing it in a big city somewhere. And I don’t see that changing anytime soon.

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